Unless you live under a rock, you’ve probably heard about Bitcoin. It’s the cryptocurrency that has been changing people’s lives for better or for worse since 2009. While Bitcoin is the king of cryptocurrencies, it faces stiff competition from countless alternative coins.
From Ethereum and Solana to Monero and Cardano—these new blockchain platforms are promising to change the world as we know it. Stick around to learn more about blockchain and how it could change online gambling in the future.
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What is Blockchain?
Blockchain is a digital, distributed ledger of records. It’s a system used to keep and verify cryptocurrency transactions. The network is maintained by computer nodes distributed across the world. This makes it impossible to hack or change its records.
Bitcoin’s founder, Satoshi Nakamoto, created the first blockchain in 2009. He built the blockchain to provide an alternative to banks, Wall Street and other financial institutions. Over time, developers found ways to create new blockchains with more capabilities than Bitcoin.
For example, the Ethereum blockchain can help developers create decentralized payment apps, online games, social networks, streaming networks and online casinos.
Blockchain in Online Gambling: What are the Benefits?
1. Building Trust
Trust is one of the biggest hindrances for the success of many casino sites. People don’t trust new gambling sites easily. Even when a company is licensed and secures its data, gamblers might not trust its games or payout records.
Blockchain could solve the trust problem in the casino sector permanently. Here’s how. Developers are creating provably fair games on the network. That means you can check each game’s RNG codes to confirm it’s fair.
What’s more, blockchain-based casinos support crypto payments. And as we mentioned, blockchain enables trustless peer to peer payments. You don’t have to trust a casino. Once you send money to your account, the network allows you to play its games.
2. Reduced Fees
When you think about it, casino players pay significant amounts of money in fees. Let’s say you gamble at the best MasterCard casinos. You use a credit card to deposit and withdraw money. The fees can range between 1.29% and 3.5%.
If you don’t use one of the major currencies—USD, EUR, GBP or CAD—then you might pay more in currency conversion fees. With blockchain technology, you can send and receive up to $2B for less than $1.
Think about it. You could transact with online casinos while paying pennies in fees regardless of your deposit amount. Importantly, crypto transactions are quick for a good reason—there’s no intermediary.
You deal with the recipient directly. By comparison, traditional payments must go through a bank, which reduces the payment speed.
Immutability in blockchain means transactions recorded on the network can’t be changed. Everything is time-stamped and stored permanently. If you win $10,000, in a slot game, the record of your winning will remain intact forever.
This could help eliminate fraud in the online gambling industry permanently. A casino can’t refuse to payout your profits when there are records you won fairly. Likewise, scammers can’t accuse casinos of not paying them when there’s proof a payout happened.
Immutability also could improve transparency in the gambling sector greatly. You don’t have to trust a casino’s word on anything. All you need is to check the blockchain for records related to payout speed, bonus policies and reviews.
One of the biggest advantages of blockchain is that it allows developers and industry leaders to innovate solutions for problems traditional systems haven’t solved yet. In the casino space, a major problem that could be solved by the blockchain is fraud.
Casinos deal with credit card fraud daily. People deposit money, gamble it and ask for chargebacks afterwards. This leaves operators with countless losses in the long haul. Another problem regards people falsifying their documents.
New employees could falsify their school accolades and certificates. Or gamblers could falsify their identities. The blockchain allows colleges to add data about their students so that employers can verify these records securely.
On the other hand, the system can prevent credit card fraud by virtue of its irreversible transactions. Crypto doesn’t support chargebacks. Once you send a payment, it’s gone forever. If you make a mistake while sending the money, you have to live with it.
Imagine if your favorite online casino had a coin that grows in value. You would probably engage with the website regularly to earn the coin. In exchange, the operator would earn a loyal customer for life.
Blockchain has been helping companies tokenize their services since its launch. Take Axie Infinity as an example. This blockchain-based game pays players when they win battles or when they breed and sell characters known as Axies.
In June, Axie Infinity’s token—AXS coin—cost less than $5. At the time of writing, it’s trading for more than $100. The coin’s tremendous growth is testament that people love crypto tokens.
If casinos could introduce similar tokens, they would probably earn a huge following. People would go after sites with the best use cases for their tokens. In turn, the coins would skyrocket in value, earning anyone who owns the cryptos a lot of money.
6. Control over your Data
Blockchain is giving people over their data in ways they could never have imagined. No longer do you need to trust a casino with your personal information. Thanks to blockchain, you can deposit money and play slots or poker without ever revealing personal information to a casino.
Of course, there are concerns anonymizing gambling could empower money launderers and other financial crimes. But this can be solved by providing only necessary information. Importantly, players can control how long a casino could keep the data and who they could share the information with.
Blockchain is no longer a mysterious word associated with Bitcoin. It’s an innovation changing the world tremendously. In the casino industry, blockchain helps companies create decentralized games.
It helps add transparency, improve security and lower transactions. In the future, it could also lead to tokenization of casino services.